- The Ethereum validator exit queue reached a record 855,158 ETH, valued at approximately $3.7 billion.
- The growing line to unstake ETH could increase sell pressure on the Ethereum market.
- The Ethereum network limits how much ETH can be unstaked at one time to protect network stability, with the current queue expected to take 15 days to process.
- Ethereum’s price dropped over 3% after nearing its all-time high, partly due to the large volume of pending unstaked ETH.
- Analysts warn that large-scale unstaking may gradually introduce more ETH into the market, applying downward price pressure if demand does not keep up.
On Friday, the Ethereum network saw its validator exit queue reach an all-time high of 855,158 ETH, worth about $3.7 billion based on current prices. The growing number of requests to unstake ETH has raised concerns about potential sell pressure on the cryptocurrency.
According to data from validatorqueue.com and price information from CoinGecko, this volume of unstaking is the largest recorded so far. The Ethereum blockchain uses staking as a way for holders to lock up their ETH to support network security and earn rewards.
The network restricts how much ETH can be unstaked at any one time to maintain stability. Clearing the current queue is expected to take around 15 days. Bitwise analyst Juan Leon told Decrypt that the increase in the exit queue may be a factor in Ethereum’s recent price decline, where it fell more than 3% shortly after nearly reaching a record high.
Leon explained that discounts on staked ETH tokens, such as stETH, can trigger collateral risk and prompt some holders to sell their assets. “Tokens like stETH can trade at a discount. That discount reduces their value as collateral, triggering risk cuts, hedges, or even liquidations that lead to spot ETH selling,” he said. He added that if the cost of borrowing ETH rises, investors may unwind leveraged trades, leading to more ETH sales and synchronized sell pressure.
Despite the uptick in unstaking requests, not all analysts believe ETH’s price will continue to decline. Leon noted that large-scale unstaking usually does not cause a dramatic price drop but can lead to a slow increase in available supply. “Unstaking doesn’t usually cause a sudden crash, but under stress it can act like a steady tap of new supply,” he said, “pressuring prices lower if it overwhelms new demand for ETH.”
The increase in unstaking follows Ethereum’s close approach to its all-time high price of $4,878 in November 2021. The token’s pullback was also influenced by uncertainty in global events and recent U.S. inflation data.
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